Giving, Volunteering Decline When People Face Economic Concerns

WASHINGTON (AFP eWire - April 11, 2003) - When people are worried about their personal economic situation, overall giving and volunteering drops, a new report shows.

The report, 'Giving in Tough Times: The Impact of Personal Economic Concerns on Giving and Volunteering,' was released at the end of March by Independent Sector. Included in the report is an article by Paulette V. Maehara, CFRE, CAE, president and CEO of the Association of Fundraising Professionals (AFP), about charity challenges in tough economic times.

A household unburdened with financial concerns gives an average of $2,040 while a household concerned about its financial state gives only $1,060, according to the report. Those who give the most have the largest decrease in giving when they become worried about finances. Households with incomes of more than $75,000 decrease their giving by almost $1,200 when they face economic worries, from more than $3,600 to less than $2,500, a 33 percent decline. In contrast, households that earn less than $25,000 a year decrease their giving by $130, from $560 to $430, a 23 percent decline.

The report is based on an analysis of Independent Sector's 'Giving and Volunteering in the United States, 2001,' which surveyed adults in the United States in the spring and summer of 2001, during a relatively stable economic period.

'These trends do not portend well if the current economic conditions cause more people to be concerned about their finances,' said Peter Shiras, senior vice president of programs at Independent Sector, in a press release.

Both religious, secular giving decreases

Households with economic worries give less overall to both secular and religious organizations. Those who give the most to religious organizations when they're not worried decrease giving the most when they become worried. Religious giving drops by more than 50 percent, from $1,170 to $540. Again, households with the highest incomes show the biggest drops in giving: Households of more than $75,000 decrease giving from $1,890 to $1,100 as economic concerns arise.

Giving to secular organizations also decreases but not as drastically as religious giving, the report said. Giving decreases by 41 percent to secular organizations when the household has economic concerns, from $880 to $520.

Volunteering drops also

The report also showed that people who worry about their finances don't volunteer as much as those without financial concerns, 40 percent vs. 53 percent.

When Americans with incomes of more than $75,000 are not worried, 61 percent of them volunteer, but as they become worried, only 56 percent volunteer. In households with incomes of less than $25,000, 36 percent of the people volunteer when they are not worried about personal finances compared to 27 percent when they are worried.

The findings are contrary to conventional wisdom that as donors reduce their giving, they attempt to make up for it by giving more of their time, according to the report.

Maehara was one of only three fundraising experts who contributed articles in the report. She outlined best practices for charities in challenging times.

Maehara's advice included:

recognize and acknowledge that some donors' priorities and their ability to give have shifted dramatically and speak with them frankly about their priorities,

keep relationships with your donors strong in times of crisis by involving major donors in discussions about your organization's priorities,

challenge board members to identify potential donors, and

be ready to demonstrate how your organization accomplishes its goals and explain how funds are used and why.

'Fundraising can be difficult even when the economy is good and the public is feeling optimistic,' Maehara wrote. 'But in challenging times, the need for an effective and efficient strategy for generating philanthropic support is vital.'